Exhibit 10.8
AMENDMENT AGREEMENT
This Amendment Agreement (this "AGREEMENT") dated June 13, 2003, is
among SmartServ Online, Inc., a Delaware corporation (the "COMPANY"), and the
investors identified on the signature page hereto (each a "Investor" and
collectively the "INVESTORS").
WHEREAS the Company and the Investors are party to a Securities
Purchase Agreement, dated May 19, 2003 (the "PURCHASE AGREEMENT"); and
WHEREAS the Company issued to each Investor a Debenture (each a
"DEBENTURE" and collectively the "DEBENTURES") pursuant to the Purchase
Agreement; and
WHEREAS the Company desires to amend the Debentures;
NOW, THEREFORE, in consideration of the agreements set forth below and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereby agree as follows:
1. Capitalized terms not defined herein that are defined in the
Purchase Agreement shall have the meanings set forth in the Purchase Agreement.
2. Unless otherwise expressly amended herein, all of the terms,
conditions and provisions of the Purchase Agreement and all documents executed
pursuant to the Purchase Agreement shall remain in full force and effect,
unaffected by this Agreement.
3. Each Debenture is hereby modified so that the fifth full paragraph
of each Debenture is deleted in its entirety and replaced by the following:
"At any time from the date hereof through the date that this
Debenture is paid in full, Lender shall have the right, in its sole
discretion, to convert the principal balance of this Debenture then
outstanding plus accrued but unpaid interest, in whole or in part,
into shares of Common Stock, par value $.01 per share ("Common Stock")
of the Borrower at a conversion price equal to $0.744, subject to
adjustment as provided herein (the "Conversion Price")."
4. The Company hereby agrees to issue to each Investor a warrant, the
form of which is attached hereto as Exhibit A, to purchase 25,000 shares of
Common Stock for each Purchased Unit purchased by each Investor, or such smaller
number of shares of Common Stock as is proportional to the number of Purchased
Units Purchased by such Investor.
5. The Purchase Agreement is hereby modified so that the preamble is
deleted in its entirety and replaced by the following:
" SECURITIES PURCHASE AGREEMENT (this "Agreement"), dated as
of May 19, 2003, among SMARTSERV ONLINE, INC., a Delaware corporation
(the "Company") and the investors signatories hereto."
6. The Purchase Agreement is hereby modified so that the text of
Section 1.1 is deleted in its entirety and replaced by the following:
"Purchase and Sale. The Company hereby agrees to issue and
sell to each signatory hereto (collectively, the "Investors", and
each, individually, an "Investor") and, subject to all of the terms
and conditions hereof and in reliance on the representations and
warranties set forth or referred to herein, each Investor severally
agrees to purchase such number of units (collectively, the "Purchased
Units") as is equal to the result obtained when the aggregate purchase
price (as to each Investor, the "Aggregate Purchase Price") being paid
by each such Investor (as set forth below such Investor's name on the
signature page hereto or any amendment hereto) is divided by the "Per
Unit Purchase Price" (as such term is defined in Section 1.2 below),
up to a maximum of 15 Purchased Units. Each Purchased Unit shall
consist of a $100,000 convertible debenture (each a "Debenture", and
collectively the "Debentures"), the form of which is attached hereto
as Exhibit A, and a warrant (the "Standard Warrant") to purchase
200,000 shares of Common Stock, par value $0.01 per share, of the
Company ("Common Stock"), the form of which is attached hereto as
Exhibit B-1, and a delisting contingency warrant to purchase 25,000
shares of Common Stock, the form of which is attached hereto as
Exhibit B-2 (together with the Standard Warrants, the "Warrants", or,
individually, each a "Warrant").."
7. The Purchase Agreement is hereby modified so that the text of
Section 1.3 is deleted in its entirety and replaced by the following:
"Closing. At such time as there are persons purchasing 3.5
Purchased Units (the "First Investors"), there shall be a closing for
the purchase and sale of such Purchased Units (the "First Closing") at
the offices of Jenkens & Xxxxxxxxx Xxxxxx Xxxxxx LLP, counsel to the
Company, at such time and date as is mutually agreed upon by the
Company and the First Investors, or at such other place as is mutually
agreed upon by the Company and the First Investors. Subsequent to the
First Closing, there shall be one or more subsequent closings for the
purchase and sale of any additional Purchased Units (each a
"Subsequent Closing"; and collectively with the First Closing, the
"Closings") at the offices of Jenkens & Xxxxxxxxx Xxxxxx Xxxxxx LLP at
such time and date as is mutually agreed upon by the Company and the
Investors purchasing Purchased Units at each Subsequent Closing (the
"Subsequent Investors"), or at such other place as is mutually agreed
upon by the Company and the Subsequent Investors. The date and time of
the First Closing and each Subsequent Closing are referred to herein
as the "First Closing Date" and the "Subsequent Closing Date",
respectively."
8. The Purchase Agreement is hereby modified so that the text of
Section 2.4(a) is deleted in its entirety and replaced by the following:
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"Immediately prior to the First Closing, and immediately
prior to each Subsequent Closing, as the case may be, not giving
effect to the sale and purchase of the Purchased Units, the authorized
and the outstanding capital stock of the Company (on a Fully Diluted
Basis including all Derivative Securities) will be as set forth in
Schedule 2.4. All such outstanding shares of capital stock will be
duly authorized, validly issued, fully paid, and nonassessable, and
will have been issued free and clear of Liens. Except as set forth in
Schedule 2.4, no adjustment has previously been made (or should have
been made) nor will any adjustment be required to be made as a result
of the Company's issuance of the Purchased Units to the rate at which
any shares of any class of the equity securities of the Company,
subscriptions, options, warrants, calls, commitments or agreements or
Derivative Securities of the Company are convertible into or
exercisable for shares of Common Stock, Derivative Securities or
shares of other equity securities of the Company (by reason of any
"anti-dilution" provisions or agreements or otherwise)"
9. The Purchase Agreement is hereby modified so that the text of
Section 5.1(b) is deleted in its entirety and replaced by the following:
"Certificates. The Company shall have delivered to each
Investor certificates evidencing the Warrants and the Debenture
acquired by such Investor pursuant to the terms hereof, each duly
executed by the appropriate Company officers."
10. The Purchase Agreement is hereby modified so that the following is
added in proper alphabetical order to Section 6.2:
"Standard Warrant Section 1.1"
11. The Purchase Agreement is hereby modified so that Exhibit A is
deleted in its entirety.
12. The Purchase Agreement is hereby modified so that the term "Exhibit
B" contained in Exhibit B is deleted and replaced by "Exhibit A".
13. The Purchase Agreement is hereby modified so that the term "Exhibit
C" contained in Exhibit C is deleted and replaced by "Exhibit B-1".
14. The Purchase Agreement is hereby modified so that Exhibit B-2 is
added, the text of which is attached hereto as Exhibit A.
15. The Purchase Agreement is hereby modified so that the term "Exhibit
D" contained in Section 2.1 and Exhibit D is deleted and replaced by "Exhibit
C".
16. The Purchase Agreement is hereby modified so that the term "Exhibit
E" contained in Section 3.1(d) and Exhibit E is deleted and replaced by "Exhibit
D".
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17. The Purchase Agreement is hereby modified so that the term "Exhibit
F" contained in Section 5.1(d) and Exhibit F is deleted and replaced by "Exhibit
E".
18. The Purchase Agreement is hereby modified so that the term "Exhibit
G" contained in the definition to "Registration rights Agreement" and Exhibit G
is deleted and replaced by "Exhibit F".
19. The Purchase Agreement is hereby modified so that Section 7.6 is
modified such that the phrase "To their respective addresses set forth on
Exhibit A." is deleted and replaced with "To their respective addresses set
forth below their respective names on the signature pages hereto."
20. The Registration Rights Agreement, dated May 19, 2003 (the
"REGISTRATION RIGHTS AGREEMENT"), among the Company and the Investors is hereby
modified so that the preamble is deleted in its entirety and replaced by the
following:
"This REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made
and entered into as of May 19, 2003, by and among (a) SmartServ
Online, Inc., a Delaware corporation (the "Company"), and (b) the
purchasers of units consisting of a $100,000 convertible debenture, a
warrant to purchase 200,000 shares of the Company's common stock, par
value $.01 per share (the "Common Stock"), and a contingent warrant to
purchase 25,000 shares of Common Stock signatory hereto (individually,
a "Purchaser" and collectively, the "Purchasers") pursuant to the
Securities Purchase Agreement of even date herewith (the "Purchase
Agreement") among the Company and the Purchasers."
21. The Registration Rights Agreement is hereby modified so that
Section 9(d) is modified such that the phrase "To their respective addresses set
forth on Schedule A" is deleted and replaced with "To their respective addresses
set forth below their respective signatures on the signature pages to the
Purchase Agreement"
22. The Registration Rights Agreement is hereby modified so that
Exhibit A is deleted in its entirety.
23. This Agreement may be executed simultaneously in any number of
counterparts, each of which when so executed and delivered shall be taken to be
an original; but such counterparts shall together constitute but one and the
same document.
[NEXT PAGE IS SIGNATURE PAGE]
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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered as of the day and year first above written.
SMARTSERV ONLINE, INC.
By:______________________________________
Name:
Title:
Purchasers:
If an Individual:
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Name:
If an entity:
Name of entity:____________________________
By:______________________________________
Name:
Title:
NUMBER OF UNITS PURCHASED:
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AMOUNT OF INVESTMENT: $
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Address of Investor:
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EXHIBIT A
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NEITHER THESE SECURITIES NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE
EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR
THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO
SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY.
SMARTSERV ONLINE, INC.
CONTINGENT WARRANT
Warrant No. W-___ Date of Original Issuance: May 19, 2003
SmartServ Online, Inc., a Delaware corporation (the "COMPANY"), hereby
certifies that, for value received, ____________ or his registered assigns (the
"HOLDER"), is entitled to purchase from the Company up to a total of ______
[25,000 shares of Common Stock per Purchased Unit purchased] shares of common
stock, $.01 par value per share (the "COMMON STOCK"), of the Company (each such
share, a "WARRANT SHARE" and all such shares, the "WARRANT SHARES") at an
exercise price equal to $0.744 per share (as adjusted from time to time as
provided in Section 9, the "EXERCISE PRICE"). This Warrant is exercisable by the
Holder only if the Company is delisted from the Nasdaq Smallcap Stock Market on
or prior to May 18, 2006 (the "EXPIRATION DATE") and the Company does not
re-list on the Nasdaq Smallcap Stock Market, or list on the Nasdaq National
Market, American Stock Exchange or the New York Stock Exchange within 90 days of
such delisting (each a "DELISTING EVENT"). Upon a Delisting Event, the Holder
may exercise this Warrant from time to time from and after the date hereof and
through and including the Expiration Date, and subject to the following
exception: If the Company is delisted from the Nasdaq Smallcap Stock Market less
than 91 days prior to the Expiration Date, and creates a Delisting Event by not
curing such delisting (as set forth above) within 90 days thereafter, the Holder
shall be entitled to exercise this Warrant for ten business days after receiving
written notice of the Delisting Event from the Company, even if such exercise
occurs after the Expiration Date.
1. Definitions. In addition to the terms defined elsewhere in this
Warrant, capitalized terms that are not otherwise defined herein shall have the
meanings given to such terms in the Securities Purchase Agreement, dated as of
May 19, 2003 between the Company, the original Holder and other original holders
named therein (the "PURCHASE AGREEMENT").
2. Registration of Warrant. The Company shall register this Warrant,
upon records to be maintained by the Company for that purpose (the "WARRANT
REGISTER"), in the name of the record Holder hereof from time to time. The
Company may deem and treat the registered Holder of this Warrant as the absolute
owner hereof for the purpose of any exercise hereof or any distribution to the
Holder, and for all other purposes, absent actual notice to the contrary.
3. Registration of Transfers. The Company shall register the transfer
of any portion of this Warrant in the Warrant Register, upon surrender of this
Warrant, with the Form of Assignment attached hereto duly completed and signed,
to the Company at its address specified herein. Upon any such registration of
transfer, an exchange Warrant to purchase Common Stock, in substantially the
form of this Warrant (any such exchange Warrant, a "NEW WARRANT"), evidencing
the portion of this Warrant so transferred shall be issued to the transferee and
a New Warrant evidencing the remaining portion of this Warrant not so
transferred, if any, shall be issued to the transferring Holder. The acceptance
of the New Warrant by the transferee thereof shall be deemed the acceptance by
such transferee of all of the rights and obligations of a holder of a Warrant.
Warrants and Warrant Shares may only be disposed of in compliance with state and
federal securities laws. In connection with any transfer of Warrant Shares other
than pursuant to an effective registration statement, to the Company or to an
Affiliate of a Holder, the Company may require the transferor thereof to provide
to the Company an opinion of counsel selected by the transferor, the form and
substance of which opinion shall be reasonably satisfactory to the Company, to
the effect that such transfer does not require registration under the Securities
Act.
4. Exercise and Duration of Warrants. This Warrant shall be exercisable
by the registered Holder, in whole or in part, at any time and from time to time
as provided in the first paragraph hereof. The Exercise Price is payable in
immediately available funds or as otherwise provided in Section 13. At 5:30
p.m., New York City time on the Expiration Date, the portion of this Warrant
available for exercise and not exercised prior thereto shall be and become void
and of no value, except as provided in the first paragraph hereof.
5. Delivery of Warrant Shares and Exercise of Warrant. Upon delivery of
the Form of Election to Purchase, which Form shall specify the number of shares
of Common Stock to be purchased, and this Warrant to the Company at its address
for notice set forth in Section 11 and upon payment of the Exercise Price
multiplied by the number of Warrant Shares that the Holder intends to purchase
hereunder, the Company shall, within three business days, issue and deliver to
the Holder, a certificate for the Warrant Shares issuable upon such exercise
with the appropriate legend, if required. As used in this Agreement, a "DATE OF
EXERCISE" means the date on which the Holder shall have delivered to the Company
(i) the Form of Election to Purchase attached hereto, appropriately completed
and duly signed, (ii) payment of the Exercise Price for the number of Warrant
Shares so indicated by the Holder to be purchased and (iii) this Warrant. If the
Warrant has not been fully exercised, the Company will deliver a replacement
Warrant to the Holder for the number of Warrant Shares remaining subject to the
Warrant, which replacement Warrant shall in all other respects be identical to
this Warrant or, at the election of the Company, an appropriate notation shall
be made on this Warrant, which shall then be returned to the Holder.
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6. Charges, Taxes and Expenses. Issuance and delivery of New Warrants,
replacement Warrants issued upon a partial exercise, and certificates for shares
of Common Stock upon exercise of this Warrant shall be made without charge to
the Holder for any issue or transfer tax, withholding tax, transfer agent fee or
other incidental tax or expense in respect of the issuance of such certificates,
all of which taxes and expenses shall be paid by the Company; provided, however,
that the Company shall not be required to pay any tax which may be payable in
respect of any transfer involved in the registration of any certificates for
Warrant Shares or Warrants in a name other than that of the Holder. The Holder
shall be responsible for all other tax liability that may arise as a result of
holding or transferring this Warrant or receiving Warrant Shares upon exercise
hereof.
7. Replacement of Warrant. If this Warrant is mutilated, lost, stolen
or destroyed, the Company shall issue or cause to be issued in exchange and
substitution for and upon cancellation hereof, or in lieu of and substitution
for this Warrant, a New Warrant, but only upon receipt of evidence reasonably
satisfactory to the Company of such loss, theft, destruction, or mutilation and
customary and reasonable indemnity, if requested. Applicants for a New Warrant
under such circumstances shall also comply with such other reasonable
regulations and procedures and pay such other reasonable third-party costs as
the Company may prescribe. If a New Warrant is requested as a result of a
mutilation of this Warrant, then the Holder shall also deliver such mutilated
Warrant to the Company as a condition precedent to the Company's obligation to
issue the New Warrant.
8. Reservation of Warrant Shares. The Company covenants that it has and
will at all times reserve and keep available out of the aggregate of its
authorized but unissued and otherwise unreserved Common Stock, solely for the
purpose of enabling it to issue Warrant Shares upon exercise of this Warrant as
herein provided, the number of Warrant Shares which are then issuable and
deliverable upon the exercise of all Warrants issued pursuant to the Purchase
Agreement. All shares of Common Stock issued upon the exercise of this Warrant
shall be validly issued, fully paid, and non-assessable and free from all
preemptive rights of any stockholder of the Company and from all taxes, liens,
and charges with respect to the issue thereof (other than transfer taxes), and
if the Common Stock of the Company is then listed on any national securities
exchange (as defined in the Exchange Act) or eligible for trading on The Nasdaq
Stock Market or the Nasdaq OTC Bulletin Board, shall be duly listed or eligible
thereon, as the case may be.
9. Certain Adjustments. The Exercise Price and number of Warrant Shares
issuable upon exercise of this Warrant are subject to adjustment from time to
time as set forth in this Section 9.
(a) Stock Dividends and Splits. If the Company, at any time while
this Warrant is outstanding, (i) pays a stock dividend on its Common Stock or
otherwise makes a distribution on any class of capital stock that is payable in
shares of Common Stock, (ii) subdivides outstanding shares of Common Stock into
a larger number of shares, or (iii) combines outstanding shares of Common Stock
into a smaller number of shares, then in each such case the
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Exercise Price shall be multiplied by a fraction of which the numerator shall be
the number of shares of Common Stock outstanding immediately before such event
and of which the denominator shall be the number of shares of Common Stock
outstanding immediately after such event. Any adjustment made pursuant to clause
(i) of this paragraph shall become effective immediately after the record date
for the determination of stockholders entitled to receive such dividend or
distribution, and any adjustment pursuant to clause (ii) or (iii) of this
paragraph shall become effective immediately after the effective date of such
subdivision or combination. If any event requiring an adjustment under this
paragraph occurs during the period that an Exercise Price is calculated
hereunder, then the calculation of such Exercise Price shall be adjusted
appropriately to reflect such event.
(b) Pro Rata Distributions. If the Company, at any time while this
Warrant is outstanding, distributes to all holders of Common Stock (i) evidence
of its indebtedness, (ii) any security (other than a distribution of Common
Stock covered by the preceding paragraph), (iii) rights or warrants to subscribe
for or purchase any security, or (iv) any other asset (in each case,
"DISTRIBUTED PROPERTY"), then, at the request of any Holder delivered before the
30th day after the record date fixed for determination of stockholders entitled
to receive such distribution, the Company will deliver to such Holder, within
seven days after such request (or, if later, on the effective date of such
distribution), the Distributed Property that such Holder would have been
entitled to receive in respect of the Warrant Shares for which such Holder's
Warrant could have been exercised immediately prior to such record date. If such
Distributed Property is not delivered to a Holder pursuant to the preceding
sentence, then upon any exercise of the Warrant that occurs after such record
date, such Holder shall be entitled to receive, in addition to the Warrant
Shares otherwise issuable upon such conversion, the Distributed Property that
such Holder would have been entitled to receive in respect of such number of
Warrant Shares had the Holder been the record holder of such Warrant Shares
immediately prior to such record date.
(c) Fundamental Transactions. If, at any time while this Warrant is
outstanding, (1) the Company effects any merger or consolidation of the Company
with or into another Person, (2) the Company effects any sale of all or
substantially all of its assets in one or a series of related transactions, (3)
any tender offer or exchange offer (whether by the Company or another Person) is
completed pursuant to which holders of Common Stock are permitted to tender or
exchange their shares for other securities, cash or property, or (4) the Company
effects any reclassification of the Common Stock or any compulsory share
exchange pursuant to which the Common Stock is effectively converted into or
exchanged for other securities, cash or property (in any such case, a
"FUNDAMENTAL TRANSACTION"), then the Holder shall have the right thereafter to
receive, upon exercise of this Warrant, in lieu of any other consideration, the
same amount and kind of securities, cash or property as he would have been
entitled to receive upon the occurrence of such Fundamental Transaction if he
had been, immediately prior to such Fundamental Transaction, the holder of the
number of Warrant Shares then issuable upon exercise in full of this Warrant
(the "ALTERNATE CONSIDERATION"). For purposes of any such exercise, the
determination of the Exercise Price shall be appropriately adjusted to apply to
such Alternate Consideration based on the amount of Alternate Consideration
issuable in respect of one share of Common Stock in such Fundamental
Transaction, and the Company or its successor or the surviving entity following
such Fundamental Transaction shall apportion the Exercise Price among the
Alternate Consideration in a reasonable manner reflecting the relative value of
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any different components of the Alternate Consideration. If holders of Common
Stock are given any choice as to the securities, cash or property to be received
in a Fundamental Transaction, then the Holder shall be given the same choice as
to the Alternate Consideration he receives upon any exercise of this Warrant
following such Fundamental Transaction. At the Holder's option and request, any
successor to the Company or surviving entity in such Fundamental Transaction
shall, either (1) issue to the Holder a New Warrant substantially in the form of
this Warrant and consistent with the foregoing provisions and evidencing the
Holder's right to purchase the Alternate Consideration for the aggregate
Exercise Price upon exercise thereof, or (2) purchase the Warrant from the
Holder for a purchase price, payable in cash within seven days after such
request (or, if later, on the effective date of the Fundamental Transaction),
equal to the Black Scholes value of the remaining unexercised portion of this
Warrant on the date of such request. The terms of any agreement pursuant to
which a Fundamental Transaction is effected shall include terms requiring any
such successor or surviving entity to comply with the provisions of this
paragraph (c) and ensuring that the Warrant (or any such replacement security)
will be similarly adjusted upon any subsequent transaction analogous to a
Fundamental Transaction.
(d) Number of Warrant Shares. Simultaneously with any adjustment to
the Exercise Price pursuant this Section 9, the number of Warrant Shares that
may be purchased upon exercise of this Warrant shall be increased or decreased
proportionately, so that after such adjustment the aggregate Exercise Price
payable hereunder for the increased number of Warrant Shares shall be the same
as the aggregate Exercise Price in effect immediately prior to such adjustment.
(e) Calculations. All calculations under this Section 9 shall be
made to the nearest cent or the nearest 1/100th of a share, as applicable. The
number of shares of Common Stock outstanding at any given time shall not include
shares owned or held by or for the account of the Company, and the disposition
of any such shares shall be considered an issue or sale of Common Stock.
(f) Notice of Adjustments. Upon the occurrence of each adjustment
pursuant to this Section 9, the Company at its expense will promptly compute
such adjustment in accordance with the terms of this Warrant and prepare a
certificate setting forth such adjustment, including a statement of the adjusted
Exercise Price and adjusted number or type of Warrant Shares or other securities
issuable upon exercise of this Warrant (as applicable), describing the
transactions giving rise to such adjustments and showing in detail the facts
upon which such adjustment is based. Upon written request, the Company will
promptly deliver a copy of each such certificate to the Holder and to the
Company's Transfer Agent.
(g) Notice of Corporate Events. If the Company (i) declares a
dividend or any other distribution of cash, securities or other property in
respect of its Common Stock, including without limitation any granting of rights
or warrants to subscribe for or purchase any capital stock of the Company or any
Subsidiary, (ii) authorizes or approves, enters into any agreement contemplating
or solicits stockholder approval for any Fundamental Transaction or (iii)
authorizes the voluntary dissolution, liquidation or winding up of the affairs
of the Company, then the Company shall deliver to the Holder a notice describing
the material terms and conditions of such transaction at least 20 days prior to
the applicable record or effective date on
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which a Person would need to hold Common Stock in order to participate in or
vote with respect to such transaction, and the Company will take all steps
reasonably necessary in order to ensure that the Holder is given the practical
opportunity to exercise this Warrant prior to such time so as to participate in
or vote with respect to such transaction; provided, however, that the failure to
deliver such notice or any defect therein shall not affect the validity of the
corporate action required to be described in such notice.
10. No Fractional Shares. No fractional shares of Warrant Shares will
be issued in connection with any exercise of this Warrant. In lieu of any
fractional shares which would otherwise be issuable, the Company shall issue the
next highest number of whole Warrant Shares.
11. Notices. Any and all notices or other communications or deliveries
hereunder (including without limitation any Exercise Notice) shall be in writing
and shall be deemed given and effective on the earliest of (i) the date of
transmission, if such notice or communication is delivered via facsimile at the
facsimile number specified in this Section 11 prior to 5:30 p.m. (New York City
time) on a day on which banks in the State of Delaware are not required or
permitted to close (a "BUSINESS DAY"), (ii) the next Business Day after the date
of transmission, if such notice or communication is delivered via facsimile at
the facsimile number specified in this Section 11 on a day that is not a
Business Day or later than 5:30 p.m. (New York City time) on any Business Day,
(iii) the Business Day following the date of mailing, if sent for next day
delivery by nationally recognized overnight courier service, or (iv) upon actual
receipt by the party to whom such notice is required to be given. The addresses
for such communications shall be: (i) if to the Company, SmartServ Online, Inc.,
Xxx Xxxxxxx Xxxxx, Xxxxxxxx, XX 00000, Facsimile No.: (000) 000-0000, Attn:
Chief Financial Officer, or (ii) if to the Holder, to the address or facsimile
number appearing on the Warrant Register or such other address or facsimile
number as the Holder may provide to the Company in accordance with this Section
11.
12. Warrant Agent. The Company shall serve as warrant agent under this
Warrant. Upon 20 days' notice to the Holder, the Company may appoint a new
warrant agent. Any corporation into which the Company or any new warrant agent
may be merged or any corporation resulting from any consolidation to which the
Company or any new warrant agent shall be a party or any corporation to which
the Company or any new warrant agent transfers substantially all of its
corporate trust or shareholders services business shall be a successor warrant
agent under this Warrant without any further act. Any such successor warrant
agent shall promptly cause notice of its succession as warrant agent to be
mailed (by first class mail, postage prepaid) to the Holder at the Holder's last
address as shown on the Warrant Register.
13. Cashless Exercise. Notwithstanding anything to the contrary
contained herein, if this Warrant will expire within five days or if, one year
from the date hereof, there is not then and has not theretofore been a currently
effective Registration Statement covering the resale of the Warrant Shares, this
Warrant may be exercised in whole or in part by presentation and surrender of
this Warrant to the Company at its principal executive offices with a written
notice of the holder's intention to effect a cashless exercise, including a
calculation of the number of shares of Common Stock to be issued upon such
exercise in accordance with the terms hereof (a "CASHLESS EXERCISE"). In the
event of a Cashless Exercise, in lieu of paying the Exercise Price in cash, the
holder shall surrender this Warrant (or portion thereof) for that number of
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shares of Common Stock determined by multiplying the number of Warrant Shares to
which it would otherwise be entitled by a fraction, the numerator of which shall
be the difference between the closing price per share of the Common Stock on the
trading day immediately prior to the date of exercise and the Exercise Price,
and the denominator of which shall be such closing price per share of Common
Stock.
14. Miscellaneous.
(a) This Warrant shall be binding on and inure to the benefit of the
parties hereto and their respective successors and assigns. Subject to the
preceding sentence, nothing in this Warrant shall be construed to give to any
Person other than the Company and the Holder any legal or equitable right,
remedy or cause of action under this Warrant. This Warrant may be amended only
in writing signed by the Company and the Holder and their successors and
assigns.
(b) All questions concerning the construction, validity, enforcement
and interpretation of this Agreement shall be governed by and construed and
enforced in accordance with the internal laws of the State of Delaware, without
regard to the principles of conflicts of law thereof. Each party agrees that all
legal proceedings concerning the interpretation, enforcement and defense of the
transactions contemplated by this Warrant (whether brought against a party
hereto or its respective affiliates, directors, officers, shareholders,
employees or agents) (each, a "PROCEEDING") shall be exclusively commenced in
the state and federal courts sitting in the State of New York in New York County
(the "COURTS"). Each party hereto hereby irrevocably submits to the exclusive
jurisdiction of the Courts for any Proceeding, and hereby irrevocably waives,
and agrees not to assert in any Proceeding, any claim that it is not personally
subject to the jurisdiction of any such court, or such Courts are improper or
inconvenient venue for such proceeding. Each party hereby irrevocably waives
personal service of process and consents to process being served in any
Proceeding by mailing a copy thereof via registered or certified mail or
overnight delivery (with evidence of delivery) to such party at the address in
effect for notices to it under this Warrant and agrees that such service shall
constitute good and sufficient service of process and notice thereof. Nothing
contained herein shall be deemed to limit in any way any right to serve process
in any manner permitted by law. Each of the Company and the Holder hereby
irrevocably waives, to the fullest extent permitted by applicable law, any and
all right to trial by jury in any Proceeding. If any party shall commence an
action or proceeding to enforce any provisions of this Warrant, then the
prevailing party in such Proceeding shall be reimbursed by the other party for
its attorneys fees and other costs and expenses incurred with such Proceeding.
(c) The Company shall not by any action avoid or seek to avoid the
observance or performance of any of the terms of this Warrant, but will at all
times in good faith assist in the carrying out of all such terms and the taking
of all such actions as may be necessary or appropriate to protect the rights of
the Holder against impairment. Without limiting the generality of the foregoing,
the Company will (i) take all such action as may be necessary or appropriate in
order that the Company may validly and legally issue fully paid and
non-assessable shares of Common Stock upon the exercise of this Warrant and (b)
use its best efforts to obtain all such authorizations, exemptions, or consents
from any public or regulatory body having jurisdiction thereof as may be
necessary to enable the Company to perform its obligations under this Warrant.
-12-
s (d) The headings herein are for convenience only, do not constitute
a part of this Warrant and shall not be deemed to limit or affect any of the
provisions hereof.
(e) In case any one or more of the provisions of this Warrant shall
be invalid or unenforceable in any respect, the validity and enforceability of
the remaining terms and provisions of this Warrant shall not in any way be
affected or impaired thereby and the parties will attempt in good faith to agree
upon a valid and enforceable provision which shall be a reasonable substitute
therefor, and upon so agreeing, shall incorporate such substitute provision in
this Warrant.
(f) All pronouns and any variations thereof refer to the masculine,
feminine or neuter, singular or plural, as the context may require. All terms
defined in this Agreement in their singular or plural forms have correlative
meanings when used herein in their plural or singular forms, respectively.
IN WITNESS WHEREOF, the Company has caused this Warrant to be duly
executed by its authorized officer as of the date first indicated above.
SMARTSERV ONLINE, INC.
By:______________________________
Name: _________________________
Title: _________________________
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FORM OF ELECTION TO PURCHASE
To SMARTSERV ONLINE, INC.:
In accordance with the Warrant enclosed with this Form of Election to
Purchase, the undersigned hereby irrevocably elects to purchase _____________
shares of common stock ("COMMON STOCK"), $.01 par value per share, of SMARTSERV
ONLINE, INC. and encloses herewith $________ in cash, certified or official bank
check or checks or other immediately available funds, which sum represents the
aggregate Exercise Price (as defined in the Warrant) for the number of shares of
Common Stock to which this Form of Election to Purchase relates, together with
any applicable taxes payable by the undersigned pursuant to the Warrant.
The Holder hereby represents, warrants and covenants that he is an
accredited investor within the meaning of Regulation D under the Securities Act
of 1933, as amended, and has sold or will sell the shares of Common Stock
issuable upon this exercise pursuant to the Company's registration statement
covering the resale by the Holder of such shares and, in connection therewith,
has complied or will comply with the prospectus delivery requirements under
Federal securities laws.
The undersigned requests that certificates for the shares of Common
Stock issuable upon this exercise be issued in the name of
PLEASE INSERT SOCIAL SECURITY OR
TAX IDENTIFICATION NUMBER
(Please print name and address)
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FORM OF ASSIGNMENT
[To be completed and signed only upon transfer of Warrant]
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto ________________________________ the right represented by the within
Warrant to purchase ____________ shares of Common Stock of SMARTSERV ONLINE,
INC. to which the within Warrant relates and appoints ________________ attorney
to transfer said right on the books of SMARTSERV ONLINE, INC. with full power of
substitution in the premises.
Dated: _______________, ____
------------------------------------
(Signature must conform in all
respects to name of holder as
specified on the face of the
Warrant)
------------------------------------
Address of Transferee
------------------------------------
------------------------------------
In the presence of:
--------------------------
-15-
